Under the third round of awards under the Innovation Fund, the EU invests over €1.8 billion in 17 large-scale innovative clean-tech projects. Grants will help bringing breakthrough technologies to the market in energy-intensive industries, hydrogen, renewable energy, carbon capture and storage infrastructure, as well as in manufacturing key components for energy storage and renewables. The selected projects are located in Bulgaria, Finland, France, Germany, Iceland, the Netherlands, Norway, Poland and Sweden.
New set of the EU grants will support innovative businesses in Europe in order to develop the cutting-edge technologies needed to drive the green transition in the member states. The Innovation Fund is an important tool to scale up innovations in renewables, in the hydrogen production and other effective solutions for European development. Compared to the first disbursement, the new funds available increased by 60%, enabling the EU to double the number of supported projects, which is a big boost for the decarbonisation of the EU energy-intensive industries.
With an additional support of more than €38 billon until 2030 from the EU Emissions Trading System (ETS), the Innovation Fund aims to create the right financial incentives for companies and public authorities to invest in the next generation of low-carbon technologies and give companies in the member states needed advantages in becoming global technology leaders.
Previous energy projects
The first call for large-scale projects awarded grants of €1.1 billion to 7 projects in energy-intensive industries, hydrogen, carbon capture, use and storage, and renewable energy; besides, 15 projects were awarded project-development assistance.
With a 60% increase in funds compared to the first round of the Innovation Fund, the EU is more than doubling the number of supported projects and also expanding the geographical reach to more countries, including in Eastern Europe, and have sped up the application and evaluation process.
Successful projects under this second call will now start to prepare their individual grant agreements with the new European Climate, Infrastructure and Environment Executive Agency (CINEA), the implementing agency of the Fund. These are expected to be finalised in the fourth quarter of 2022, allowing the Commission to adopt the corresponding grant award decision and start distributing the grants.
This autumn, the Commission will launch the third call for large-scale projects; as announced in the REPowerEU Plan, the funding available will be doubled to around €3 billion to further support the EU’s independence from Russian fossil fuels (thus, application projects that were not successful in the previous calls are encouraged to re-apply).
In July 2021, the Commission proposed (as part of the Fit for 55 package) to top up the Innovation Fund, currently sourced from 450 million allowances from the existing ETS in 2021-30, with 50 million allowances from the existing ETS and 150 million allowances from the new system covering emissions from road transport and buildings. In addition, under the proposal, allowances which would otherwise be allocated for free to industry sectors covered by the Carbon Border Adjustment Mechanism would be auctioned and added to this Fund.
More on the proposal for revised EU ETS Directive in: https://ec.europa.eu/info/files/revision-eu-emission-trading-system_en. Additional information on “Delivering the European Green Deal” in: https://ec.europa.eu/info/strategy/priorities-2019-2024/european-green-deal/delivering-european-green-deal_en
EU’s decarbonisation efforts
The selected projects cover a wide range of sectors contributing to numerous the EU’s decarbonisation efforts, such as production, distribution and use of green hydrogen, waste-to-hydrogen projects, offshore wind, manufacturing of photovoltaic (PV) modules, battery storage and recycling, carbon capture and storage, sustainable aviation fuels, and advanced biofuels.
Put together, these projects in implementation have a potential to save 136 million tons of CO2-equivalent over their first 10 years of operation.
In addition, there are about 20 promising projects (although not yet sufficiently mature for a grants) will be pre-selected for project development assistance by the European Investment Bank. These will be announced in the fourth quarter of 2022.
General source: https://ec.europa.eu/commission/presscorner/detail/en/ip_22_4402